Road toughens after Obama's first 100 days

WASHINGTON -- The second 100 days?

The phrase lacks the resonance of the first 100 days, the opening period that sets the tone, signals the priorities and provides early clues to the course of a presidency. Even so, the next stretch of Barack Obama's time in the White House, from Wednesday until about the time Congress begins its summer recess, looms as a period no less critical in how his tenure ultimately will be judged.

Since his inauguration 14 weeks ago, Obama has thrown a remarkable number of balls into the air — committing trillions of dollars in spending and dramatically extending the reach of the federal government in the economy. He has launched rescue plans for automakers and beleaguered banks, outlined timelines to withdraw U.S. troops from Iraq and send them to Afghanistan, and reversed his predecessor's policies on everything from stem-cell research to the prison at Guantanamo Bay, Cuba.

Now those balls are coming down. At a town hall-style meeting in suburban St. Louis on Wednesday, Obama plans to deliver a progress report and outline the administration's agenda going forward. He'll hold his third prime-time news conference that night in the East Room.

"These are going to be important months," says David Axelrod, one of Obama's closest White House advisers. "I'll stipulate that the next 100 days aren't going to be any easier in certain ways than the first 100. We know that."

Axelrod and other White House officials say it will be critical to show continued action on the economy and nurture hope of a turnaround, even as the unemployment rate probably worsens and home foreclosures continue. One key to public support: Vigilance over spending of the $787 billion stimulus package to avoid scandal and waste.

"If you were going to name it in a book, you'd call the first 100 days 'Laying the Groundwork,' " says Douglas Brinkley, a Rice University historian who has written volumes chronicling presidents Theodore Roosevelt, Franklin Roosevelt, Gerald Ford and Jimmy Carter.

"You're planting seeds," Brinkley says. "The image of Obama's first 100 days is almost Michelle putting organic seeds in the ground. In the second 100 days, people are expecting things to grow."

During the next three months:

• The future of the U.S. auto industry will become clear, or at least clearer. On Thursday, Chrysler hits a government-imposed deadline for restructuring that will determine whether it's eligible for billions more dollars in aid. General Motors, which has 30 days after that to show progress, on Monday announced plans to close 13 plants, eliminate thousands of dealerships and swap bank debt for stock.

• The results of federal "stress tests" on banks are to be released next week, providing a measure of their health and an indication of whether more action is needed to stabilize them.

• Capitol Hill hearings on legislation to control health care costs and expand coverage are slated for summer, a test of whether the bills can command enough consensus to make it through Congress this year.

• Most of the 21,000 additional U.S. troops and trainers Obama has promised for Afghanistan will arrive there as officials prepare for presidential and provincial council elections set for August.

Then there are the developments the White House can't control or predict.

During his first 100 days, Obama found himself in a standoff with pirates who had taken an American sea captain hostage, and he's now dealing with a global outbreak of swine flu.

He faces pressure from some congressional Democrats for an investigation into brutal interrogations of terrorist suspects during the Bush administration, an inquiry that could fuel partisan tempers and make progress on other issues more difficult.

So far, he hasn't had a showdown with congressional Democrats on a major issue, but that time surely is coming.

During the next 100 days, intra-party tensions could build on such causes as Obama's push to curtail budget earmarks for pet projects and the desire by Hispanic leaders and others to move quickly on providing a path to legal status for illegal immigrants.

For modern presidents, the first months in the Oval Office often display the strengths and weaknesses that will mark their terms, though there are limits to the meaning of the milestone.

The first 100 days were workmanlike and low-key for George W. Bush; the Sept. 11 attacks that would reshape and define the 43rd president's tenure were months away. The first 100 days of the 42nd president, which started with a firestorm over gays in the military, in some ways presaged Bill Clinton's roller coaster tenure.

If the first 100 days typically show what the president chooses to tackle first, the second 100 days often illustrate whether he is going to succeed.

"He's entering into the long, hard slog (in Iraq and Afghanistan), which is probably a good metaphor for how the second 100 days will differ from the first 100 days on many issues," says Michael O'Hanlon, a foreign policy analyst and editor of Opportunity 08: Independent Ideas for America's Next President.

In the president's opening weeks in office, "he could make the snap, immediate decision, and some of the big things to do were flashy and glitzy. Now you're getting into more of the workhorse period, and the results won't always be dramatic … but they will be hugely important."

From now to Aug. 7, the 44th president will need to implement programs, push proposals through Congress and demonstrate that his economic policies are beginning to show results.

Here are some keys to watch:

April: Sink or swim?

By Thursday, one crucial question will be answered: Will Chrysler survive?

A month ago, Obama gave the automaker 30 days to put together a partnership with Fiat and win concessions from the United Auto Workers and its debt holders. That done, Chrysler, which has received $4 billion in federal loans, would be eligible for another $6 billion.

If the last-ditch talks fail, however, an American car company founded before the Great Depression could go out of business.

Chrysler on Sunday reached an agreement with the UAW to cut labor costs, and the banks holding $6.9 billion in debt have softened their demands — two important steps in the negotiations, which are continuing.

The stakes for Obama are high. In a speech outlining his plan to save the auto industry last month, he hammered auto executives for years of bad decisions and told union leaders they would have to make concessions.

"We cannot, we must not, and we will not let our auto industry simply vanish," Obama said.

Most Americans oppose the government's auto bailout, according to a USA TODAY/Gallup Poll taken last month, but many analysts warn that the collapse of one of Detroit's Big Three would be a major blow not only to automakers and their suppliers but also the nation as a whole.

"It would probably drive the economy into what the auto industry is already experiencing, and that is a depression," says David Cole, chairman of the Center for Automotive Research in Ann Arbor, Mich.

"If we go there, for the next 100 days President Obama would be working very hard to try not to be the Herbert Hoover of the 21st century."

Even so, Cole describes possible bankruptcy as a necessary threat to force an agreement in the "cage match" between the UAW and the Chrysler bondholders, with the federal government acting as referee. If the parties won't make enough concessions to reach a deal by the Thursday deadline, "the government steps out and lets the lions in," he says.

The best thing for auto manufacturers would be an improvement in the overall economy, including the loosening of credit markets to allow more people to buy cars and a revival of consumer optimism so they would feel safe in doing so.

At that point, pent-up demand for new cars could boost automakers — if they can hold on until then.

General Motors also is trying to craft a new plan to win more federal aid.

At a news conference Monday in Detroit, GM's chief executive, Fritz Henderson, outlined a plan that would phase out the Pontiac brand, cut 21,000 hourly jobs and make the federal government the company's majority owner.

GM's deadline: June 1.

May: Reckoning for banks

Efforts to shore up the economy will continue to dominate the administration's agenda as officials work to prevent home foreclosures, crack down on credit card companies, pass regulatory changes and prop up the nation's financial institutions.

"This is highly complex, uncharted territory," says Scott Talbott of The Financial Services Roundtable. "There is no roadmap or blueprint for guidance."

How Obama navigates the minefields of the economy, by far Americans' top concern, will affect his public support.

A majority of Americans rated his overall job performance as "excellent" or "good" in a USA TODAY/Gallup Poll taken last week, but Obama received somewhat lower marks for his handling of the economy than for his efforts on national security.

Managing the results of the Treasury Department's "stress tests" on the nation's 19 largest banks, including Citigroup and Bank of America, will be among the first difficult decisions for Obama after the 100-day mark.

Results of those government tests on the financial viability of the big lenders are set to be released May 4. They will determine whether the banks need more capital to carry them through the recession. If they do, the next question will be where to get the financing needed.

"Politically speaking, it will be difficult to get Congress to approve more money," Talbott says.

Banks have been given more than $200 billion in federal bailout funds. If the tests show they need much more, Obama will have to decide whether to try to expand the 6-month-old $700 billion financial bailout fund, the Troubled Asset Relief Program (TARP). Economists such as Sean Snaith of the Institute for Economic Competitiveness at the University of Central Florida warn that releasing the test results could cause more turmoil in the financial system.

If the Obama administration and the Federal Reserve release details showing significant problems at the nation's biggest banks, financial markets and customers might panic, he says. But if such details are not disclosed, then people will wonder whether things are worse than they are.

"They are damned if they do, and damned if they don't in some ways," Snaith says.

If the results are really bad, he says, the government better have a plan ready to make sure people know the banking system will be supported.

"That eases some of the blow of the bad news," he says.

June: Pushing health care

It may not be clear by midsummer that health care reform will succeed, but it should be clear "if we're going down in flames again," says Ed Howard of the non-partisan Alliance for Health Reform.

Obama has been emphatic about the need to change the system, and soon. On Feb. 24, he told a joint session of Congress: "Nearly a century after Teddy Roosevelt first called for reform, the cost of our health care has weighed down our economy and our conscience long enough. …

"So let there be no doubt: health care reform cannot wait, it must not wait, and it will not wait another year."

By the time members of Congress leave Washington, D.C., for their August recess, the public should know whether Obama at least has a shot at achieving what has eluded so many of his predecessors: signing legislation aimed at reining in skyrocketing costs and providing coverage to the Americans who go without, now close to 46 million.

There are some encouraging signs: Hearings have begun in Congress. Republicans and business groups are working with Democrats and labor unions. Finance Committee Chairman Max Baucus, D-Mont., says he plans to have a bill ready for a Senate vote by June, and the House is planning to follow fast.

There are signs of discord as well, however. Lawmakers already have rejected Obama's proposal to raise $318 billion to cover the uninsured by limiting tax deductions for the rich. And many Republicans oppose Obama's call for a government plan to compete with private insurers.

It hasn't helped that Kansas Gov. Kathleen Sebelius, Obama's pick for Health and Human Services secretary, isn't on the job yet. The Senate Finance Committee approved her nomination last week, and the Senate is scheduled to begin debate on it today.

Her confirmation would end an embarrassing episode for the administration that saw the president's first choice, former Senate majority leader Tom Daschle, withdraw amid reports about his failure to pay taxes.

Despite the problems of the past and the pitfalls ahead, reform advocates say economic pressures make this the right time for health care changes finally to get through Congress.

"There have been four major moments of opportunity for health reform since Harry Truman," says Drew Altman, president of the Kaiser Family Foundation. "The average time between major national health reform windows since Truman: 19.7 years. So if it doesn't happen now, we may have to wait a while."

August: Vote or fight?

Here's the question: Can Afghanistan afford to hold elections on Aug. 20 when the government doesn't control much of the territory and violence is rampant?

For the White House, the follow-up question has become: Can Afghanistan afford not to?

The voting for a president to succeed Hamid Karzai had been scheduled for April, then delayed. Now Karzai, whose term expired in May, is staying on the job until the election and, if necessary, a runoff in October. Postponing the vote again would spotlight the country's perilous state and create a leadership crisis.

By the time Afghans go to the polls, most of the 17,000 in additional U.S. forces and 4,000 military trainers that Obama has promised should have arrived, bolstered by some additional NATO forces.

They are part of a strategy the president unveiled in February that calls for bigger local police forces, increased development aid and outreach to some former Taliban fighters to try to turn around a deteriorating security situation.

Announcing the policy was the first step, O'Hanlon says. Implementing it is proving to be harder.

"They need to figure out what it means to promote reconciliation with 'moderate elements' of the Taliban, if that's a meaningful phrase," says O'Hanlon, an analyst with the Brookings Institution.

He also cites the need to develop stronger relationships with leaders in Afghanistan and Pakistan, improve the military command structure and coordinate international aid.

The conflict in Afghanistan, which already has stretched for more than seven years, is on course during Obama's first term in office to surpass Vietnam as the longest war in U.S. history. Even as the situation in Iraq has become more stable — elections there are scheduled for the end of the year — the one in Afghanistan has worsened.

What's more, the situation in Afghanistan affects neighboring Pakistan, the nuclear-armed Islamic state that faces its own political and security perils.

How Obama's policies in the wars he inherited in Iraq and Afghanistan play out during the next few months will help shape his foreign-policy credentials and determine his global agenda.

"The first 100 days were the policy review and development phase," deputy White House communications director Dan Pfeiffer says.

"The next 100 days are the policy implementation phase."

What 100 days can tell us

Presidents' first 100 days sometimes provide harbingers for their terms in office, but not always. A look at the record of recent White House occupants.

Reported by Seung Min Kim and Susan Page. 1 – Gallup Poll taken in April of the president's first year in office.